An Illinois House committee Thursday signed off on a measure that would allow voters to decide if millionaires should pay more in state income taxes.

At the same time, the House Revenue Committee put a stake in efforts to bring a progressive income tax to Illinois by voting down a proposed constitutional amendment on the issue.

The committee voted along party lines to approve the proposed constitutional amendment by House Speaker Michael Madigan, D-Chicago, that would impose a 3 percent surtax on incomes above $1 million. Income up to $1 million would continue to be taxed at the state's personal income tax rate, currently set at 5 percent.

Madigan said his amendment would apply to the more than 13,000 millionaires in the state. He said it would raise about $1 billion a year that would be distributed to K-12 school districts on a per-pupil basis. Each school district would receive $550 per student regardless of a district's financial health.

“Within our society, those who earn over $1 million are better equipped than others to support education,' Madigan said.

Rep. David McSweeney, R-Barrington Hills, said he was concerned about the impact on small businesses, many of which are set up to pay income taxes at the personal rate rather than the higher corporate rate. Coupled with the 2011 temporary income tax increase, McSweeney said, Madigan's proposal would mean a 167 percent tax increase on those businesses since 2010.

“This is more of a perception tax than a reality,” he said. “It is a perception Illinois wants to penalize success.”

However, Rep. John Bradley, D-Marion, said the surtax is a good approach for areas like his that do not have many millionaires.

“This is an opportunity for a lot of areas in the state to actually do a lot better with minimal impact on my regions,” he said.

The proposed amendment now goes to the full House, which must approve it by a three-fifths vote. The Senate will then have to approve it by the same margin for the issue to appear on the November ballot.

Minutes after approving Madigan's tax plan, the Revenue Committee voted down a proposed amendment to bring a graduated income tax to Illinois. Three Democrats withheld their support from the amendment.

Illinois currently has a flat income tax in which the same tax rate applies to all income levels. The proposed amendment would have changed that so that higher incomes would be subject to a higher tax rate and lower incomes to a lower rate.

The amendment did not spell out what those rates would be.

Rep. Michael Zalewski, D-Riverside, said it would have helped if a companion bill had been introduced to spell out the rates that would be imposed if the amendment were approved. Since there wasn't one, he said, he opted to vote “present.”

Page 2 of 2 - On Wednesday, Gov. Pat Quinn called on lawmakers to make permanent the 67 percent income tax increase imposed in 2011. Madigan and Senate President John Cullerton, D-Chicago, both said they support the idea.